Section 8 of the Payment of Bonus Act is as follows:
Eligibility of Bonus - Every employee shall be entitled to be paid by his employer in an accounting year, a bonus, in accordance with the provisions of this Act, provided he has worked in the establishment for not less than 30 working days in that year.
Section 10 states that the employer has to pay to his employee in the subsequent accounting year a minimum bonus of 8.33% of wages, whereas Section 11 states that the maximum bonus should be 20% of wages.
An employee whose salary does not exceed Rs. 10,000 per month is eligible to receive a bonus. Where the salary or wage of an employee exceeds Rs. 3,500 per month, the bonus payable to such an employee shall be calculated as if his salary or wage were Rs. 3,500 (See Section 12 of the Act).
Section 12 - Calculation of Bonus with Respect to Certain Employees - Where the salary or wage of an employee exceeds Rs. 3,500 per month, the bonus payable to such an employee under Sec. 10, or as the case may be, under Sec. 11, shall be calculated as if his salary or wage were Rs. 3,500 per month.
This means if the wage of the employees exceeds Rs. 3,500, then the wages to be calculated for the bonus are to be taken as Rs. 3,500 only.
Furthermore, Section 19 is as follows:
Section 19 - Time-limit for Payment of Bonus
(a) Where there is a dispute regarding the payment of the bonus pending before any authority under Sec. 22, within a month from the date on which the award becomes enforceable or the settlement comes into operation, in respect of such dispute;
(b) In any other case, within a period of eight months from the close of the accounting year.
Also, see the definition of the accounting year in Section 2(1).
Section 2(1) "Accounting Year" Means -
(i) In relation to a corporation, the year ending on the day on which the books and accounts of the corporation are to be closed and balanced;
(ii) In relation to a company, the period in respect of which any profit and loss account of the company laid before it in the annual general meeting is made up, whether that period is a year or not;
(iii) In any other case -
(a) The year commencing on the 1st day of April; or
(b) If the accounts of an establishment maintained by the employer thereof are closed and balanced on any day other than the 31st day of March, then, at the option of the employer, the year ending on the day on which its accounts are so closed and balanced.
Provided that an option once exercised by the employer under para. (b) of this sub-clause shall not again be exercised except with the previous permission in writing of the prescribed authority and upon such conditions as that authority may think fit.
Therefore, the bonus has to be paid within 8 months from the date of closure of the accounting year. The accounting year is to be decided according to the above-said definition of the accounting year.
Note: The sections I have mentioned are as per the latest amendment till December 2011.